HÀ NỘI — Việt Nam’s stock market was on the downswing for a week and this bearish decline is unlikely to end due to investor pessimism over market prospects that have seen a downward trend in August in the previous years.

The benchmark VN-Index, the measure of 310 stocks on the HCM Stock Exchange, sank during four out of five sessions last week and rose only marginally on Thursday. It lost a cumulative 3.8 per cent to close the week at 627.4 points.

On the Hà Nội Stock Exchange, the HNX-Index, which tracks 379 stocks, retreated 3.2 per cent to end Friday at 81.1 points.

Most of these stocks, which gained hugely in the previous weeks following speculation over their positive earnings in the first-half of the year, were sold heavily last week when their financial reports were released.

Bank, securities and real estate shares, the market leaders, all fell across the two boards. Meanwhile, the downtrend of oil and gas stocks was partly halted in the last two sessions, thanks to recovery of global oil prices.

Brent crude future slipped 0.9 per cent on Friday, but saw a weekly rise of 3.3 per cent. US crude also fell 0.9 per cent, but was back above US$40 a barrel, closing Friday’s session at $41.57 per barrel.

Some consecutive sessions of decline brought the prices of many shares back to an attractive level, which appealed to risk-taking investors who had bet that falling prices would rebound in the coming sessions.

“Bottom-fishing demand was good for surging liquidity, offering a chance of rally for the two indices,” Trần Tuấn Anh, a stock analyst at Bảo Việt Securities Co, wrote in a report.

The daily trading volume rose slightly last week on the HCM City exchange, averaging more than 120 million shares, worth VNĐ2.2 trillion ($99 million) per session, up 2.4 per cent over the previous week.

The volume of trading dropped 7.4 per cent, averaging more than 38 million shares, worth VNĐ419 billion per day on the Hà Nội Stock Exchange.

“Although medium-term uptrend is being maintained, this decline is unlikely to end,” Anh said, while adding that the next rallies were likely to be technical recovery for investors to reduce stocks’ exposure.

“Short-term trading is forecast at the 610-620 thresholds,” Anh said.

The VN-Index climbed 12.6 per cent in the first seven months of this year.

This August coincides with the seventh lunar month in which business usually slows down. The stock market is also used to seeing a downtrend this month, particularly as the first-half earnings prospects run out of steam and the market faces a lack of support information.

The stock market has seen declines in both indices and liquidity since August 2012. The VN-Index lost more than nine per cent in August 2015.

Foreign trading were the highlight of the market last week. The foreign sectors continued to be net buyers in the domestic market, responsible for a net buy value of VNĐ360 billion. They picked up shares worth a net buy value of VNĐ1.6 trillion in the past month.

According to Nguyễn Tuấn Anh, head of the brokerage department of Saigon Securities Inc’s Hải Phòng branch, this could be a support for market recovery in the near future.

“When new cash flows pour into the market, the impact of pessimism in the seventh lunar month will not be as bad as in the past,” Anh said. — VNS